GR 81314; (May, 1989) (Digest)
G.R. No. 81314 & G.R. No. 81447, May 18, 1989
EAGLE SECURITY AGENCY, INC. and PHILIPPINE TUBERCULOSIS SOCIETY, INC., petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, et al., respondents.
FACTS
Petitioner Philippine Tuberculosis Society, Inc. (PTSI) engaged petitioner Eagle Security Agency, Inc. (EAGLE) under a “Contract for Security Services” to provide guards for its premises. Private respondents, security guards deployed by EAGLE to PTSI, filed a complaint for unpaid wage and allowance increases under Wage Order Nos. 2, 3, 5, and 6. The Labor Arbiter held both PTSI and EAGLE jointly and severally liable. The National Labor Relations Commission (NLRC) affirmed this ruling. Both PTSI and EAGLE filed separate petitions for certiorari, each arguing the other should be solely liable. PTSI relied on a contract clause stating EAGLE was solely responsible for paying its employees in accordance with labor laws. EAGLE invoked provisions in the Wage Orders stating that for security service contracts, the increases “shall be borne by the principal or client.”
ISSUE
Whether the NLRC committed grave abuse of discretion in holding PTSI and EAGLE jointly and severally liable for the unpaid wage and allowance increases due to the security guards.
RULING
The Supreme Court dismissed the petitions and affirmed the NLRC decision. The legal logic is anchored on the distinct but complementary liabilities of the labor-only contractor and the principal under the protective mantle of labor legislation. The contractual stipulation making EAGLE “solely responsible” for its employees’ lawful compensation cannot negate the statutory and jurisprudential solidary liability of the principal. The Wage Order provisions cited by EAGLE, which state the increases “shall be borne by the principal,” do not exonerate the contractor but merely designate the principal as the ultimate bearer of the cost. This does not extinguish the contractor’s primary obligation as the direct employer to ensure payment. The Court emphasized that labor laws are construed liberally in favor of workers. Imposing solidary liability on both entities ensures that the workers’ legally mandated wages are paid, as it prevents either party from evading responsibility through contractual technicalities. This ruling gives life to the constitutional policy of affording full protection to labor. The Court also found no abuse of discretion in including all named security guards as complainants, as the records supported their claims.